Nucor shuts down steel mill due to market conditions
CONVENT, La. (AP) — Nucor Corp. has decided to temporarily halt production at its St. James steel mill because of market conditions, the company announced.
Nucor said Wednesday that its direct reduced iron plant has shut down for routine maintenance. Afterward, the company will continue to stop production at the facility until market conditions improve, The Advocate (http://bit.ly/1IaB1U2) reported.
St. James Parish President Timmy Roussel said none of the employees at the plant will be laid off.
Nucor issued a statement saying the company has a history of keeping its workers even during down market conditions.
Roussel said he hopes the plant can start production again in January, if market conditions improve.
“When the raw materials market improves, Nucor Steel Louisiana has the ability to quickly ramp up and resume producing DRI,” spokeswoman Katherine Miller said in a news release.
The company invested $750 million in the mill as the first part of a larger $3.4 billion steel complex that altogether would employ 1,250 people. The plant uses natural gas to make high-purity steel pellets from iron ore. Nucor mixes the pellets with scrap metal to make steel.
According to data from the London Metal Exchange, a ton of steel was selling for $480 on Dec. 16, 2014. As of Dec. 9, that price had plunged to $170 per ton.
Peter Ricchiuti, a finance professor at Tulane University who tracks regional stocks across the South, said a number of factors have hit the steel industry, including the slowdown of the Chinese economy, along with the fact that Chinese steel mills are continuing to run, even at a loss, flooding the global market with metals.
“Everybody wants to be Nucor,” Ricchiuti said. “They’re definitely the right player, with the right technology. They’ve just been hit by this tidal wave of low steel prices.”
Information from: The Advocate, http://theadvocate.com